A statistical analysis of Surface Escort cost estimation
Bradley, Cecil D.
Greer, Willis R., Jr.
Hoivik, Thomas H.
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This study investigates the relationship of the component weights of US Navy Surface Escort Ships and their corresponding costs of construction. The procedures of various US Navy agencies who conduct Surface Ship Costing are described, with emphasis upon the method followed by COMNAVSEASYSCOM, Washington, D.C.. A statistical analysis is provided which focuses upon multiple linear regression techniques applied to the weight/cost relationship. Additionally, the research includes the investigation of non-weight explanatory variable contribution to the various models. This analysis concludes that linear relationships do exist between the variables. The statistical evidence provided suggests that linear regression provides equivalent results to non-linear logarithmic transformation of the dependent cost variable. Further, the analysis indicates that the inclusion of non-weight dummy variables, such as contract type for vessel construction, enhance models with strictly weight explanatory variables. The models developed herein lack the precision demanded of budgetary cost estimating. However, the equations will generate point estimates that may add credence to existing methods, especially within concept formulation or tradeoff studies.
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